Solid Waste Privatization Lowers Costs, NSWMA Says

A National Solid Waste Management Association study describes how cities can privatize their garbage collection, disposal, and recycling programs while protecting the environment and often while maintaining employment.

Mar 24, 2011

Privatized waste services generate significant cost savings and lower financial risks for budget-stretched municipalities, and they are safer and more environmentally protective than their public sector counterparts, according to a study by the National Solid Wastes Management Association (NSMWA).

“During a time when municipalities are facing declining revenues and severe budget shortfalls, waste collection, recycling, and disposal are among the services most ideal for privatization,” said NSWMA President and CEO Bruce J. Parker.

NSWMA– a sub-association of the Environmental Industry Associations – represents for-profit companies in North America that provide solid, hazardous and medical waste collection, recycling and disposal services, and companies that provide professional and consulting services to the waste services industry. NSWMA members conduct business in all 50 states

According to the study, privatizing waste offers communities many benefits:

Privatized waste collection lowers costs. According to the Reason Foundation, competitive delivery of solid waste services typically generates cost savings on the order of 20 to 40 percent. This is because private companies have the economies of scale to spread investment, environmental protection, and procurement costs across multiple contracts and facilities. In addition, they are not hindered by governmental bureaucracies.

Privatized waste collection protects recycling rates. The cities with the highest recycling rates – including San Francisco and Seattle – have fully privatized recycling. That’s largely because private sector recyclers have more experience and financial ability to assume and manage risks in volatile commodities market. The private sector also is responsible for innovations like single-stream recycling, which have helped to double Americans’ recycling rates in the last 20 years.

Privatized waste collection is safer. According to the U.S. Department of Labor, solid waste management services operated by local governments have an injury rate more than four times greater than private counterparts. Private-sector employees also missed fewer work days than public sector employees due to injury.

In addition to these documented advantages of private solid waste management, the study describes how cities can privatize their garbage collection, disposal, and recycling programs while protecting the environment and often while maintaining employment. The private solid waste sector is one of the fastest-growing adopters of alternative fuels and hybrid vehicle technologies to reduce emissions and is more likely to use further energy-saving technologies, such as on-board route management software. And employees of public waste collection services are first in line for new jobs when a municipality transitions to private-sector collection, because these employees already are skilled and familiar with local routes.

“Americans still generate a lot of trash – more than four pounds per person per day. Major indicators show the private sector is better equipped to deal with this trash safely, responsibly, and sustainably, while saving consumers and local governments a lot of money,” Parker said.